Addressing the media after a marathon meeting on Thursday, Uday Kotak, the new non-executive chairman of IL&FS, said the company has a total of 348 subsidiaries, associates and joint ventures, which is much more than what the new board was aware of.
The ministry of corporate affairs (MCA) on Friday filed an application with the Mumbai bench of the National Company Law Tribunal (NCLT), seeking to direct the newly constituted board of IL&FS to sack the management of IL&FS’ subsidiaries, joint ventures and associates.
Sanjay Shorey, joint legal director, told FE, “We have filed an application, seeking the court’s permission for the new board of IL&FS Group to be able to replace the existing management and board of directors of their various subsidiaries, wherever it is required”.
Addressing media after a marathon meeting on Thursday, Uday Kotak, the new non-executive chairman of IL&FS said the company has a total of 348 subsidiaries, associates and joint ventures, which is much more than what the new board was aware of or what had been reported earlier in the media.
The MCA, in its application on Friday, also sought protection for the newly appointed board against any legal action from its numerous creditors and investors.
In its application, the government said it is not seeking immunity but is seeking a shield for the new board from any potential threat that may arise from legal action by its creditors and investors. This is so that the board can work without any hindrance, Shorey said. He added the government has asked that any legal action against further defaults should be directed through the NCLT. The tribunal has reserved its order in the case.
The total liabilities of the IL&FS group stand at Rs 91,000 crore currently, with most of its operating assets owned by its subsidiaries. According to IL&FS’ annual report, the company’s total liabilities are in excess of Rs 1 lakh crore.